Sanofi-Aventis,Indonesia's Bio Farma Mull Ops

Sanofi-Aventis,Indonesia's Bio Farma Mull Ops
JP/14/Bio

Sanofi-Aventis,Indonesia's Bio Farma Mull Ops

Phelim Kyne
Dow Jones/Jakarta

French pharmaceutical firm Sanofi-Aventis (SNY) is in talks
with Indonesia's state-owned vaccine manufacturer PT Bio Farma to
jointly produce and market a multi-combination vaccine formula, a
senior executive of the Indonesian firm said recently

The two companies plan a "marketing (and) production alliance"
for a five-vaccine combination formula called pentavalent that
could begin production by early 2006, Bio Farma president Marzuki
Abdullah told Dow Jones Newswires.

Pentavalent will combine Sanofi-Aventis' vaccine for childhood
haemophilus influenza type-B with Bio Farma's vaccines for polio,
diphtheria, hepatitis B and tetanus respectively, Marzuki said.

Sanofi-Aventis said discussions on the combined operations
with Bio Farma remain in the very early stages.

"At this point in time everything is still only
tentative . . . no formal agreements or final agreements have
been finalized for production of this pentavalent product,"
Jakarta-based Sanofi-Aventis spokesman Bob Hage told Dow Jones
Newswires in a written statement.

Marzuki said the pending alliance with Sanofi-Aventis would
allow both companies to exploit the growing global popularity of
multiple vaccine formulas in single, easily dispensed doses.

"We know the global market needs pentavalent...it's a big
market," he said, without elaborating on the possible demand or
revenue that Sanofi-Aventis and Bio Farma may reap from the
formula.

A possible production and marketing agreement with Sanofi-
Aventis would be invaluable in improving Bio Farma's marketing
and production capacity.

Bio Farma currently exports vaccines to 74 countries
worldwide, but Marzuki said the company would benefit from the
expertise of Sanofi-Aventis' marketing arm.

"We need a marketing alliance with a big pharmaceutical
company," he said.

"Bio Farma entered the global market only three or four years
ago, so we have limited manpower (to exploit) the international
market," he said.

An alliance with Sanofi-Aventis would also boost Bio Farma's
revenue and corporate image six months after the World Health
Organization decertified the firm as a WHO-approved vaccine
supplier.

The WHO decertified Bio Farma in February after the company
failed to fulfill unspecified "administrative procedures" during
a routine WHO inspection, acting WHO Indonesia country
representative Frits Reijsenbach de Haan told reporters at a
press briefing in May.

Although the WHO said the recertification didn't reflect on
the quality of Bio Farma's vaccines, the international health
organization hasn't yet re-certified the firm as an approved
supplier.

Bio Farma's WHO supply contracts constitute 15 percent of the
company's total annual sales Marzuki said, without providing a
dollar value for those sales.

Marzuki said the government is intent on keeping Bio Farma as
a state-owned firm, despite an ongoing privatization drive that
the government hopes will raise Rp 3.5 trillion in revenues in
2005.

Instead, Bio Farma hopes to raise funds needed for production
capacity expansion through future cooperation agreements with
foreign drug firms and expected funding from the Islamic
Development Bank, Marzuki said, without elaborating.

"There is big demand in the global market for our products,"
he said, adding, "(But) as long as we can still support
ourselves, we'll do that."